DISNVESTMENT IN MARUTI UDYOG LTD.
In terms of the decision of CCD dated 14.5.2002, Government of India entered into with Suzuki Motor Corporation and Maruti Udyog Ltd., a revised Joint Venture Agreement on 15.5.202.
The RJVA envisaged the completion of IPO by 31st March 2003 and in case it was not possible to complete the same by that time, GOI could extend the same till 31st December 2003.
The RJVA provides for certain Affirmative Rights to Government with regard to asset stripping and employee retrenchments, variation of rights attached to the shares, reduction of share capital, winding up of MUL, etc whereby MUL cannot take decision on the aforesaid matters without the approval of the GOI nominee/Director. These rights are available to Government till GOI holds not less than 25% equity in MUL or 31st March 2003 whichever is earlier. Further, GOI has the option to invoke the put option available to it in terms RJVA, which would expire on April 30, 2004.
SMC, in the spirit of their ongoing cooperation and to facilitate the process of the sale of shares by GOI, had voluntarily offered to extend
- The date of expiry of the seven affirmative rights conferred on GOI under the Revised Joint Venture Agreement dated May 15, 2002 (“RJVA”) from March 31, 2003 to July 31, 2003.
- The date of expiry of the put option under the RJVA, which currently ends on April 30, 2004 to August 31, 2004.
Government today accepted the above offer of SMC and cleared the amendments to the RJVA to give effect to the above offer of SMC.